DuPont Decomposition
Why does SARDAEN earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
10.9% = 15.2% × 0.45 × 1.58
Latest: FY2025
Profitability
Net Margin
15.2%
10.7% →15.2%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
0.45x
0.20x →0.45x
Revenue per ₹ of assets
Leverage
Equity Multiplier
1.58x
1.61x →1.58x
Assets funded by equity vs debt
Trend Analysis
ROE improved by 7.6 pp over 3 years. Driven by net margin improving (10.7% → 15.2%), asset turnover improving (0.20x → 0.45x).
Historical Decomposition
Last 3 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2023 | ₹0Cr | ₹0Cr | 10.7% | 0.20 | 1.61 | 3.4% |
| FY2024 | ₹0Cr | ₹0Cr | 9.9% | 0.15 | 1.54 | 2.3% |
| FY2025 | ₹0Cr | ₹0Cr | 15.2% | 0.45 | 1.58 | 10.9% |
How to read DuPont
- • Rising ROE from margin = pricing power, operational improvement (good)
- • Rising ROE from turnover = better asset utilization (good)
- • Rising ROE from leverage = more debt, amplified risk (caution)
- • Falling ROE across all three = structural deterioration (red flag)
DuPont decomposition from audited annual financials. Factual analysis, not investment advice.